Demo day is one of the most important milestones for startups in accelerators. A good demo day can mean a great fundraising round, closed quickly. Here’s how to make the most of your demo day.
Basic Preparation
Pitch Practice:Do give yourself the best chance by practicing a lot. At least ten times a day in the week before demo day; 70 run-throughs may seem excessive but the practice will pay off. Film yourself on your phone each time and watch it — you’ll be critical enough to get better, fast.Don’t worry about having the absolute best presentation, instead focus on delivering a clear, simple pitch.
Fundraising Plans:Do have 2 fundraising plans. One for a smaller round “We’re raising $1M on a $6M cap”, which targets Angels and Seed Funds. Then for larger VCs: “Should we find the right partner, we have a plan for a $3M round”.Don’t go into demo day without a clear plan for fundraising. Most investors will ask what you’re raising during a conversation, if they’re at all interested.
Demos:Do keep it simple. Try to show off your core feature and make the demo 100% visual, most investors will watch from afar.Don’t expect to have people’s attention for long. Your demo shouldn’t take more than 1 minute and it shouldn’t require you to explain it.
On the Day
Pitch Whatever Happens:Do go with the flow and smile at any situation. Your audience will be friendly and, impressed by your resilience, they will often help with some applause during a difficult situation. Some of the best pitches I’ve seen, began with a well-handled mishap.Don’t let a situation outside of your control ruin your pitch. Even if you’re well practiced, your microphone may have audio issues, the slides might be wrong or you could just forget your lines — whatever happens — keep going with confidence.
Work the Floor:Do split up and cover all the main congregation points, everyone present should be collecting leads. Following SendHub’s Demo Day in 2012, we got meetings with 100+ investors, most from speaking to them during the day. Given there was minimal interest in us via the online introduction system, this approach saved the day.Don’t waste time staring at social media or talking with your cofounders. The only time you shouldn’t be talking to investors on demo day is when you’re on stage.
Talk to a lot of Investors:Do talk to a lot of different investors, in many cases, this will be your only opportunity to meet them. If you know who is coming, research the best investors for your industry and be sure to chat with them before the day is over.Don’t let one investor monopolize all your time. Treat demo day as the start of conversation with an investor. If an interaction is taking too long, be polite and remind them you’ll have plenty of time to chat more, in a calmer environment, in the coming days.
Once it’s Over
Request Meetings Immediately:Do request meetings that night. Remember, other companies from the demo day will be competing for investor time and you want to be first in line.Don’t wait to send out your meeting requests. The less time between your conversation and a meeting request, the more likely you are to get that meeting.
Focus on Fundraising:Do focus on fundraising. Making the best use of the investor leads you’ve generated, can give your company up to 2 years of runway.Don’t be tempted to return to business as usual — building product, marketing, selling to customers etc. Most companies should take the opportunity to raise a round.
Prioritize your Meetings:Do focus on Angels, then Seed Funds. Getting early yesses generates momentum in your round and Angel investors will make decisions the fastest, so schedule them first. Next you can add your meetings with seed funds and lastly the larger VCs. If you get momentum early in the process, it will often shorten the fundraising process overall due to “fear of missing out”.Don’t spend time with the larger VCs first. They will take the longest time to close, if they close at all.
Demo day is a huge but nerve-racking opportunity. Good preparation will lead to good execution and the capital you raise for your startup can give you the chance to keep building for years to come. Take the opportunity and make it happen.
If you’re a B2B company at the seed stage looking for help, you can reach me at ash@ashrust.com.
Thanks to Kaego Rust, Patrick Lu and David Smooke for their help on this article.